Senators urge Obama administration to include carbon costs in coal program

By Timothy Gardner

WASHINGTON (Reuters) - Democratic U.S. senators on Monday urged the Obama administration to reform the federal coal mine program to include costs of the fuel's carbon emissions and potentially raise royalties paid by companies that mine the fuel on public lands.

Senator Maria Cantwell of Washington, the top Democrat on the senate energy panel, and seven other senators asked Interior Secretary Sally Jewell in a letter to use the agency's existing powers to develop a plan on federal coal mining.

The federal leasing program on coal is nearly 40 years old and does not account for costs associated with carbon emissions.

"We must be much more aggressive in reforming the outdated federal coal program," said Cantwell. "Taxpayers deserve a fair return on the sale of resources they own, but the current program is broken."

A senate aide said one path Interior could take is to raise royalties on publicly mined coal above the current 12.5 percent.

Public lands provide 40 percent of coal production. The lawmakers estimate that coal produced there accounts for 14 percent of all U.S. carbon pollution produced by energy.

The letter to Jewell said that while the Obama administration is pushing other countries to cut greenhouse gas emissions "there is still more to be done at home."

Earlier this year, the Interior Department's Bureau of Land Management opened around 10 billion tons of coal on public lands for mining.

Environmental groups such as the Sierra Club have been critical of BLM, arguing that allowing coal mining and oil and gas drilling on federal land erases the benefits of the Obama administration's major climate change proposals like the Clean Power Plan that cuts emissions from plants that generate electricity.

The Sierra Club said the BLM's plans would result in nearly 23 times more carbon dioxide emissions over their lifetime than the Keystone XL pipeline would.

Facing complaints that the Obama administration's public lands policy contradicts its climate change strategy, Jewell earlier this year called for a conversation about modernizing the government's federal coal program.

The BLM recently held sessions in the U.S. West to discuss ways to reform the program, such as raising royalty rates.

(Reporting by Timothy Gardner and Valerie Volcovici; Editing by David Gregorio)

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